WEDNESDAY 1/29/14

Asia jumps higher on the happy Turkey central banker action. NIKK gains over 400 points up +2.7%. The dollar/yen teeters at 103. Advantest, the largest maker of chip testing equipment, loses -10% after lowering forecasts. Lenovo pops +4.6% announcing two new business divisions to branch out services. Corning warns over falling LCD glass prices. SSEC gains +0.6%. Asia across the board is higher as the pressure on emerging markets evaporates due to Turkey. The Lunar New Year celebrations begin in Asia and this year is the Year of the Horse for China. Will the horse win the race this year catapulting the stock market higher, or, will the horse gallop to the glue factory? China, South Korea, Taiwan and Vietnam markets will be closed to celebrate the new year.

Deutshe Bank issues a profit warning and warns about litigation costs. The bank is taking steps to reduce leverage moving forward which will lower profits but create a more stable bank. Retailer Mulberry takes the pipe collapsing -28% after lowering guidance. The retailer says holiday discounting creates a deteriorating retail environment. The market mood turns sour on the news. Fiat reports a slight miss on earnings and suspends the dividend so it collapses -4%. Basic resources and miners are strong. Metals are up and oil down. Gold 1259. European markets begin higher but steadily leak lower as the session proceeds. The CAC slips negative.

The Turish lira starts to weaken again laying an egg in last evening’s happy meal. Over the last 24 hours, the lira moved above 2.39 (representing its weakest point) and then the central bank raising rates last evening strengthened the lira to 2.18 stabilizing the crisis. At 4 AM EST, the lira begins softening again now at 2.2293. Turkey did not receive much bang for the buck. Concerns reignite over troubled global currencies. The South African rand continues weakening, now at 11.129, and the central bank is in a meeting to develop a path forward. The Argentine peso continues weakening with the currency pair now above 8 again. The global market mood sours.

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The day ends with the SPX down 18 points, -1%, to 1774. This is where the markets launched higher after the December Fed meeting so all the market gains over the last month are gone. The Dow drops 190 points, -1.2%, to 15739. The Nasdaq loses -1.1% to 4051 and the RUT drops -1.4%. 

Semiconductors, SOX, held up better only losing -0.5%, awaiting QCOM earnings after the bell. QCOM -1.2%. FSL leaps +15%. YHOO collapses -9%. Yahoo is down -17% this year. Today is an ugly market day with concern growing that emerging markets may be brutally beaten moving forward.

After the bell, FB beats on top and bottom lines and catapults +12%. QCOM beats on EPS but misses slightly on the top line and jumps +2%. The tech sector will receive a boost tomorrow. A second bank executive death occurs in London when a former DB manager is found hanging in his home. The other incident was a JPM executive that jumped to his death. The authorities believe both are suicides but suspicions surround the tragedies.